You can use it in a couple of ways. first is to make a paste with MM and water or rose water- apply this paste to the hair then leave it to dry. once it is dry, gently rinse it off with water making sure you dont break any hair strands (the paste can get quite hard). dry as usual. another method is to first apply oil on your hair first, then apply the paste. once dry, shampoo off and dry. this method is better if you have dry hair. the last method is good if you're in a hurry and you dont have time to wash your hair- take a palmful of MM and run it through your hair, rubbing it gently onto your hair and especially into the scalp. this absorbs the oil and dirt. shake off the powder and brush your hair to take out the excess powder..
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Best way to use multani mitti on hair: Take some multani mitti powder and prepare a paste by mixing it with buttermilk (chhach), apply this pate on hair using a brush or fingers. See this image: http://readanddigest.com/wp-content/uploads/2012/12/Multani-Mitti -for-Hair1.jpg